Jesse Kline: Daryl Katz didn't break Alberta's election rules, but he broke the spirit of the law

Katz didn't break Alberta's election rules, but the spirit of the law

What’s the point of having an election-financing law if it can easily be skirted? That’s the question Albertans should be asking themselves after the Chief Electoral Officer of Alberta found that Katz Group Properties Inc. (KGP) did nothing wrong by sending a $430,000 bulk donation to the Progressive Conservative party in the waning days of the last election, despite a $30,000 donation limit.

According to the report released Wednesday, Edmonton Oilers owner Daryl Katz reached out to a PC party volunteer just weeks before the election. Katz then turned the matter over to lawyers who, according to the report, discussed “the legal propriety of bulk donations.”

As it turns out, the lawyers were right: The report concluded the allegation that “Mr. Katz or the Katz Group exceeded the $30,000 contribution limit” is “unfounded” because “there was a clear identification of funds connected with the actual contributions and each contribution respected the $30,000 limit.”Although KPG sent the party a $430,000 bank draft, it also included a list of 17 names of people and companies who contributed to that amount within the $30,000 limit. All the parties paid KPG within a few days of the bank draft being issued.

But breaking the letter of the law, and the spirit of the law, are two different things. Especially when we consider that Katz is looking for the provincial government to contribute $55-million toward the building of a new arena for his hockey team.

If campaign-financing laws can’t stop the public from believing that some people are using money to influence public policy, then there’s no point to having the law in the first place

For Katz, this appears to have been a simple economic calculation: Getting his friends, family and business associates to donate a large chunk of money to a political party is much less costly than coming up with private capital to fund the remainder of the downtown arena. Compared to the price tag on the new home for the Oilers, half a million is just the cost of doing business.

But preventing situations in which interest groups looking for government handouts are seen to be paying off the lawmakers who are charged with making such decisions is why we have campaign-finance laws in the fist place. Any time business and politics are allowed to mix, we will have situations where big money is used to influence the government. In most cases, that comes at the expense of the taxpayers who are forced to pay to support these business interests.

If campaign-financing laws can’t stop the public from believing that some people are using money to influence public policy, then there’s no point to having the law in the first place.

The PCs think Wednesday’s decision vindicated the party. The Solicitor General went as far as to call the whole exercise, “nothing more than Wildrose witch hunt.” But the opposition Wildrose Party is right to suggest that the government should take this opportunity to plug what is now being referred to as the “Katz loophole.”

Albertans have a right to know that their political system cannot be corrupted by companies and unions willing to donate large sums of money to political campaigns

The Wildrose previously suggested banning bulk donations over a certain size, but that idea was voted down by the government. In a press release Wednesday, the party called for a ban on “all corporate and union donations to political parties,” which doesn’t sound like such a bad idea in light of recent events.

This would not only prevent businesses from making large donations that look like nothing more than political bribes, it would also prevent public-service unions from gaining political influence that will later be used to fatten their pocketbooks, at the expense of the people paying their salaries. At the same time, the Alberta government should look at easing restrictions on third-party advertising. If Katz, or anyone else, wants to tell the public why they deserve a new arena, or why they think one leader is better than the other, let them do so. More speech is always good.

But Albertans have a right to know that their political system cannot be corrupted by companies and unions willing to donate large sums of money to political campaigns. Even though Katz’s donation may have backfired (the public backlash against the donation makes it hard for the government to announce funding for the arena any time soon) this will not be the last time we find ourselves in this type of situation, unless the laws are changed.

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